China, the biggest supplier of rare earths, may almost double exports this year and meet quotas set by the government as lower prices stimulate demand.

Chinese exports were 49% of the government-alloted quota in the first 11 months of last year because the slowing global economy sapped demand, the ministry of commerce said in a December 27 statement. Overseas sales quotas may be virtually unchanged this year at 31,130 tonne, based on Bloomberg calculations.

Export quotas may be met this year as overseas demand recovers, Wang Caifeng, a former official overseeing the rare- earth industry with the ministry of industry and information technology, said in an interview in Beijing. High prices last year had deterred purchases and led to inventories depletion. Smuggling also hampered exports through illegal channels.

Prices of rare earths have tumbled since the third quarter as consumers including makers of electric cars and wind turbines sought to reduce use. The average price of lanthanum oxide, a rare earth used in rechargeable batteries and refining catalysts, was 129,167 yuan ($20,508) a tonne in the fourth quarter, 15% less than in the third quarter, according to data from Shanghai Steelhome Information.

Lynas, developer of the worlds largest rare earths refinery, fell as much as 4.7% to A$1.23 today in Sydney, set for its biggest decline in almost two weeks.

China produces at least 90% of the worlds rare earths, used in Boeing helicopter blades and Toyota Motor hybrid cars. The nation has curbed output and exports of rare earths since 2009, when quotas were set at 50,145 tonne, as part of its wider move to conserve mining resources and protect the environment.

The Chinese government allocated 10,546 tonne of first-round export quotas to nine companies, including China Minmetals and Sinosteel, that have met the governments environment protection standards, the ministry said. Another 14,358 tonne may be granted to 17 other companies, including Baotou Iron & Steel Group, Chinas biggest producer, that was not granted an export license for this year, it said. Baotou is one of 21 smelters waiting for approval, it said.

Baotou will be able to get the license to resume exports this year, Wang said. Its just a matter of time as it takes a while for the government to review the companys environmental improvement.

Inner Mongolia Baotou Steel Rare-Earth Hi-Tech, the rare earth unit of Baotou Iron & Steel Group, has yet to receive approval to resume exports, a company spokesman, who declined to be identified because of company policy, said .